Approaching a Full Year of Declining Video Game Sales

In the past eleven months video game sales have dropped every month compared to the numbers they posted last year. This October sales hit $755 million dollars, a full 25% lower than the year before’s 1 billion dollars in the month of October. There is some reason to worry if you are a game developer like 343 Studios or Bioware, due to the fact that this console generation is seven years old.

I myself, as a “hardcore gamer,” can tell you the main reason for the drop in sales is the consumer waiting for the next big thing. Since the days of playing Duck Hunt, the console cycle is usually around 5 years at the max, before a new generation is announced.

The reasoning behind waiting so long to produce a new generation of consoles on the part of Microsoft and Sony is two simple facts. First off, the two giants were willing to take a loss on each Xbox 360 and Playstation 3 sold at launch, focusing first on outdoing the other’s console in performance and graphics. In turn, both companies didn’t start making a profit on each unit sold until a couple years after the release, which is one reason the 360 and PS3 have had such long life cycles.

The other reason each company has waited is they weren’t sure what the next generation would or should provide to gamers. It is no secret that technology advances at a rapid rate, and there are so many variables with video game consoles like doing away with discs and having all games be downloaded, the possibility of incorporating motion controls into the console. These are all really tough decisions that can make or break a console.

Now with all that said, I don’t think that these declining sales numbers should have anyone scared or making huge waves, but if we don’t see the next generation come soon (aside from the Wii U launch) things could get ugly.

If you are a gamer, you have so many choices aside from consoles these days such as mobile games. The beauty of being a mobile game developer is you have new hardware to develop for yearly, with new tablets and smart phones launching so often.

Take the new iPad 4, for example, with the A6X chip, that in my opinion is able to produce better looking games than any current console. Once Bluetooth controllers and other peripherals become more refined for the iPad and other tablets, the video game console companies should start to worry about their new competition.

Microsoft is trying to use SmartGlass to show how tablets can create a better gaming experience as a tool, but in my mind tablets will soon be a great gaming experience on their own. It will be very interesting to see what the next generation of consoles brings to the table and how Microsoft and Sony plan to show the world that consoles still rule the gaming arena.

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